Coordinated R&D Programs and the Creation of New Industries

Abstract

Complex systems technologies—including “deep tech”—are prone to numerous frictions that stymie commercial development. Yet technologies with these features underpin some of the most valuable industries of the past century. We examine how large, mission-oriented government R&D projects have overcome these obstacles to instigate commercial industry takeoffs using a seminal example: radar in World War II. We show that this effort established the building blocks of a commercial radar industry by (i) establishing radar’s technical foundations and (ii) cultivating an ecosystem of researchers, manufacturers, input suppliers, and customers. The combination of both public funding and coordinated investments across the value chain were needed to surmount erstwhile market failures. The case reveals how mission-oriented R&D institutions may have market-shaping impacts on complex technologies, while illustrating how grand challenges can be met by and contribute to joint public-private efforts to develop emerging technology.

Keywords: Mission-oriented R&D, Industrial policy, Technology policy, Industry emergence, Dual-use spillovers